The US Government Can't Account For Billions Spent In Afghanistan

KANDAHAR CITY -- In its bid to win the hearts and minds of
Afghanistan’s teeming population, the United States has spent
more than $55 billion to rebuild and bolster the war-ravaged
country.

That money was meant to cover everything from the construction of
government buildings and economic development projects to the
salaries of U.S. government employees working closely with
Afghans.

Yet no one can say with any authority or precision how that money
was spent and who profited from it. Most of the funds were
funneled to a vast array of U.S. and foreign contractors. But
according to a recent audit by the Special Inspector General for
Afghanistan Reconstruction (SIGAR), there is no way of knowing
whether the money went for the intended purposes.

“The audit shows that navigating the confusing
labyrinth of government contracting is difficult, at best,” SIGAR
said in releasing the audit. “USAID, the State Department and the
Pentagon are unable to readily report on how much money they
spend on contracting for reconstruction activities in
Afghanistan.”

One large part of the problem is that the United States is not
demanding accountability for outgoing funds from U.S. companies
which have little incentive to fully disclose where the U.S.
money is going. Add to this the many Afghan companies that
have minimal accounting capabilities and you have a recipe for a
massive misappropriation of funds. The money flows from
Washington to Afghanistan, with little oversight and
accountability, and at every step along the way someone else
takes a cut.

“There’s no mechanism to track where this money is going,” said
Scott Amey, general counsel for the Project on Government
Oversight, an independent, nonprofit group that investigates
government corruption. “Security problems persist and this money
doesn’t seem to be accomplishing a real mission.”

As staggering amounts of U.S. tax dollars virtually vanish down a
black hole, many of the government projects designed to foster
improved relations with the Afghan people and undermine the
appeal of the Taliban have fallen far behind
schedule or simply aren’t completed. In October, SIGAR found that
six Afghan National Police buildings were so poorly built that
they are unusable. They were constructed at a cost of $5 million
by Basirat Construction, an Afghan construction company.

Another report found that the United States has spent nearly $200
million on Afghan security service buildings that cannot be used.
SIGAR also found that the U.S. Agency for International
Development (USAID) couldn’t account for nearly $18 billion that was
paid to some 7,000 U.S. and Afghan contractors for development
projects. Afghan contractors often pay kickbacks to local
warlords, like Ahmad Wali Karzai, the president’s brother
and the so-called “King of Kandahar.” Their actions often
undermine the work of the coalition.

Botched construction projects aren’t the only U.S.
failures. Earlier this summer, coalition forces cleared Malajat, a longstanding Taliban
stronghold in the eastern flatlands just outside of Kandahar
City. But after they were forced out in September, many of the
residents of Malajat remained sympathetic to the Taliban’s cause.

In an effort to project provincial and national authority and
strengthen Afghan infrastructure, Canada’s Commander's Emergency
Response Program and the USAID ordered the construction of four
government buildings in Malajat where local residents could meet
with government officials to air grievances. The complex was
meant to symbolically supplant Taliban power and influence.

In accordance with U.S. General David Petraeus’ plan to expand
contracting awards to Afghan firms, Afghan companies were hired
late in September. The contractors then hired Afghan
subcontractors to begin construction in the shadow of a fortress
built by Alexander the Great around 330 B.C.

Since then, however, little work has been done and the project
has fallen behind schedule. As of early November, Afghans earning
about a dollar a day had only dug holes for the foundation of the
building complex, which was optimistically scheduled to be
completed by July.

Work Habits, Cultural Mandates

Most Afghans do little work in the winter months. Despite
numerous inquiries, U.S. and Canadian officials could not
estimate the cost of the project. Gen. Ben Hodges, a former top
U.S. commander in Kandahar, told The Fiscal Times that the
success of the Kandahar offensive will depend in part on the
United States and its allies building Afghan economic, political
and security infrastructure over the winter. Projects like the
Malajat government building are essential to keeping the Taliban
out once the fighting season resumes next spring, especially as
the U.S. strategy review has shown tenuous progress here. But
there is little confidence among soldiers and development workers
that this project will be completed in time.

“We can pour as much money as we want into this and it’s not
getting done by the spring,” said an official with the Kandahar
Provincial Reconstruction Team (KPRT), a civilian and
Canadian-led organization jointly operated with the United
States. “These people [Afghan contractors] have no
accountability.” Thomas Ford, a spokesman for the KPRT project,
said he could not reveal the identities of Afghan contractors
involved because of security concerns. He also said he did “not
have the exact cost figures in front of [him]”and declined to
provide them. Canadian forces, along with KPRT, are scheduled to
leave next summer. The United States is expected to assume sole
responsibility for their projects.

Petraeus, commander of the NATO International Security Assistance
Force (ISAF) and U.S. Forces Afghanistan, acknowledged in a
September memorandum that the contracting process in Afghanistan
has been deeply flawed for years and needed to be changed if the Afghan war is to
be won.

“With proper oversight, contracting can spur economic development
and support the Afghan government and NATO's campaign
objectives," wrote Petraeus. "If, however, we spend large
quantities of international contracting funds quickly and with
insufficient oversight, it is likely that some of those funds
will unintentionally fuel corruption, finance insurgent
organizations, strengthen criminal patronage networks and
undermine our efforts in Afghanistan."

At Kandahar Airfield, a base the size of London’s Heathrow
Airport located just outside of Kandahar City, contractors
provide transportation, food service, sanitation and
construction, among other services. According to a July 2010
Congressional Research Service report, as of last March private
contractors made up 57 percent of all personnel in Afghanistan
employed by the Department of Defense. "This apparently
[represents] the highest recorded percentage of contractors used by DOD in any conflict in the
history of the United States," the study found.

According to the report, there were 68,197 Pentagon contractors
in Afghanistan, compared with 52,300 uniformed U.S. personnel. Of
the Pentagon contractors, 9,300 were U.S. citizens, 52,000 were
Afghan, and 7,000 were third-country nationals. There has been a
300 percent increase in contractors since 2007, according to the
Defense Contract Management Agency.

Outside of U.S. bases, Afghan firms are primarily employed due to
security concerns in places like Kandahar City. As with the
Malajat buildings, locals are hired for construction projects
that U.S. military commanders have said are key to demonstrating
Kabul’s central authority, especially in provinces reluctant to
recognize Afghan President Harmid Karzai as their ruler. Afghan
contractors have also been hired to help train Afghan police.

As a result of U.S. pressure, the Afghan government recently
arrested American Roy Carver, CEO of Red Sea
Engineers and Constructors, a company that has received $500
million in Pentagon contracts to construct buildings at U.S.
bases. Carver is charged with not paying his Afghan
subcontractors.

Amey, of the Project on Government Oversight, said the situation
in Afghanistan mirrors the U.S. experience in Iraq: Security
concerns made it difficult for foreign contractors to work on the
battlefield, forcing reliance on local contractors with little
accountability. It’s an endless cycle of frustration and failure.

“It seems as if there wasn’t a lessons- learned approach carrying
into Afghanistan, which is not to waste federal taxpayer dollars
on contracting projects like this,” Amey said in an interview
with The Fiscal Times. “We can build an embassy and things can
work around that, but what are we doing around the rest of
country? If our money is going to security and the rest is going
to impractical projects that aren’t being completed, then the
government has to reevaluate the model.”